The proposed changes directly and substantially impact consumers by altering the rules by which the nation’s largest banks can implement, modify or suspend HELOCs.
 
The Federal Reserve published its proposed changes on August 26, 2009 and has invited the public to submit comments by December 24, 2009.  The Federal Reserve will consider the submitted comments, re-evaluate its proposed changes, and publish the revised regulations that then become law.  KamberEdelson (http://www.kamberedelson.com) will formally submit comments to the Federal Reserve on behalf of consumers to ensure that the final regulations sufficiently reflect their needs and interests.
 
“We’re concerned that banks are blatantly disregarding the current regulations and will seek to exploit any wiggle room to maximize their ability to suspend HELOC accounts without proper cause and in an unfair manner,” said Jay Edelson, managing partner at KamberEdelson.
 
Currently, federal law allows the suspension of home credit lines in very limited circumstances, including substantial declines in home value and material adverse changes in borrowers’ financial circumstances.  The potential changes would relax these standards, allowing, for example, banks to suspend credit lines based on vague notions that a borrower has moved into “higher default risk categories.”  The potential changes also would explicitly endorse the use of certain types of “hedonic” automated valuation models and tax valuations, which consumer groups claim are used to systematically undervalue housing prices.
 
 “The banking industry spends millions of dollars on lobbying to ensure that its interests are reflected in federal regulations,” explained Edelson.  “We feel it’s critical that the Federal Reserve put the needs of individuals and families first.  We intend to make sure that consumers are adequately represented and that any new rules or regulations out of Washington are fair and in the best interest of the American people.”
 
KamberEdelson has filed class action lawsuits against multiple national banks, including Citibank, Chase, Washington Mutual and Wells Fargo, alleging that the banks have violated the Truth-in-Lending Act by suspending or reducing consumers’ HELOCs without any legitimate basis.
 
KamberEdelson would like to hear from homeowners about their experiences with HELOCs.  If any homeowners would like to share a story about their HELOC experiences, or otherwise discuss the proposed changes to the Truth-in-Lending Act, they are encouraged to email KamberEdelson at HELOC@kamberedelson.com.

About Jay Edelson:  Jay Edelson testified before the U.S. in 2008 in connection with the contaminated pet food recall, which resulted in a settlement of over $24 million. He has a reputation for bringing and winning high profile class action lawsuits. Just last year, Edelson settled a nationwide case involving lead paint contamination with Thomas the Tank Engine & Friends Wooden Railway children’s toys that was valued at over $30 million. Edelson’s firm also was lead counsel in the lawsuits coming out of the 2008 contaminated pet food recall, which resulted in a settlement of over $24 million. Edelson testified before the U.S. Senate in connection with that case.

Media Contacts:
Glenn Selig
PR Firm: The Publicity Agency
Phone: (813) 708-1220 x7777 or cell: (813) 300-5454
Email: glenn@thepublicityagency.com(BlackBerry)
 
Patrick Flanary
PR Firm: The Publicity Agency
Phone: (813) 708-1220 x7781
Email: pflanary@seligmultimedia.com